Income Tax Appellate Tribunal - Chennai
Hardy Exploration & Production (India) ... vs Assessee on 16 February, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
BENCH 'C' CHENNAI
Before Shri N. S. Saini, Accountant Member and
Shri George Mathan, Judicial Member
.....
I.T.A. No. 1890/Mds/2011
Assessment Year : 2008-09
M/s. Hardy Exploration & The Assistant Director of
Production (India) Inc.,Floor No.5, v. Income Tax, International
West Minister Building, Taxation,
108, Dr. Radhakrishnan Salai, Chennai.
Chennai-600 004.
(PAN: AAACV2469H)
(Appellant) (Respondent)
Appellant by : Shri R. Vijayaraghavan,
Advocate
Respondent by : Shri Omkareshwar Chidra,
CIT-DR
Date of Hearing : 16-02-2012
Date of Pronouncement : 24/02/2012
ORDER
PER GEORGE MATHAN, JUDICIAL MEMBER :
This is an appeal filed by the assessee against the order of the learned Dispute Resolution Panel (DRP), Chennai in F. No. DRP/Chennai/Sectt./30/2011 dated 18-08-2011 for the assessment year 2008-09.
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2. Shri R. Vijayaraghavan, Advocate represented on behalf of the assessee and Shri Omkareshwar Chidra, learned CIT-DR represented on behalf of the Revenue.
3. In the assessee's appeal, the assessee has raised the following grounds :
"The grounds of appeal stated herein are without prejudice to one another.
1. The order of the Assistant Director of Income-tax-I, International Taxation, Chennai ('AO') passed pursuant to the directions issued by the Dispute Resolution Panel (Hon'ble DRP') to the extent prejudicial to Appellant is erroneous, bad in law and contrary to the facts and circumstances of the case.
2. The Hon'ble DRP and learned AO erred in questioning the validity of revised return filed by the Appellant.
3. The Hon'ble DRP and learned AO erred in computing book profits under section 115JB of the Act when the provisions of section 115JB of the Act are not applicable to the Appellant pursuant to Production Sharing Contract ('PSC') entered with Government of India ('GOI').
4. The Hon'ble DRP and learned AO have erred, in law and in facts, by holding that depletion of capitalized development expenditure is not depreciation for the purpose of giving effect to clause (iii) to Explanation (1) of section 115JB(2) in computing book profit under section 115JB of the Act.
Further, the Hon'ble DRP and learned AO have also erred in not considering the ruling of Chennai Tribunal in the Appellant's own case for earlier Assessment Years.3
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5. The Hon'ble DRP and learned AO have incorrectly computed the lower of brought forward loss and unabsorbed depreciation, whichever is less as per books of account while computing the book profit under section 115JB of the Act.
6. The Hon'ble DRP and learned AO have erred in law and in fact, by adding back site restoration cost as an unascertained liability while computing book profit under section 115JB of the Act.
The Hon'ble DRP and learned AO have also erred in not considering the ruling of Chennai Tribunal in Appellant's own case for earlier Assessment Years.
7. Without prejudice to the above grounds, the Hon'ble DRP and learned AO have erred in levying interest under sectin234C of the Act on assessed income and not on the returned income.
8. Without prejudice to the above grounds, the Hon'ble DRP and learned AO have erred in levying interest under sectin234B of the Act.
The appellant craves leave to add, alter, vary, omit, amend or delete one or more of the above grounds of appeal at any time before, or at the time of, hearing of the appeal, so as to enable the ITAT to decide this appeal according to law."
4. It was submitted by the learned authorised representative that in regard to grounds 1 & 2 the grounds were general in nature. In regard to ground No.3 in the assessee's appeal it was submitted that the assessee was not pressing the said ground. Consequently, grounds 1, 2 & 3 of the assessee's appeal stand dismissed.
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5. In regard to ground No.4 it was submitted by the learned authorised representative that the issue was squarely covered by the decision of the co- ordinate Bench of this Tribunal in the assessee's own case dated 09-06-2011 in ITA Nos. 2154, 2155, 802, 803 & 1077/Mds/2010 for the assessment years 2002-03, 2003-04, 2005-06 and 2006-07 wherein the issue has been restored to the file of the Assessing Officer. It was the submission that he had no objection if the issue in this ground was also restored to the file of the Assessing Officer on identical directions as in the assessee's own case for the assessment years 2002- 03, 2003-04, 2005-06 and 2006-07, mentioned earlier.
6. In reply, the learned DR fairly agreed that the issue may be restored in line with the directions of the co-ordinate Bench of this Tribunal in the assessee's own case.
7. We have considered the rival submissions. A perusal of the order of the co-ordinate Bench of this Tribunal shows that this issue has been discussed and restored to the file of the Assessing Officer for re-adjudication vide para 13 of the said order at pages 49 to 52. In the circumstances, respectfully following the decision of the co-ordinate Bench of this Tribunal in the assessee's own case, referred to supra, the issue in this ground is restored to the file of the Assessing Officer for re-adjudication on the same directions as given in the assessee's own case in ITA Nos. 2154, 2155, 802, 803 & 1077/Mds/2010 dated 09-06-2011. 5
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8. In regard to ground No.5 it was fairly agreed by both the sides that the issue was consequential to the decision in regard to ground No.4 which has been restored to the file of the Assessing Officer for re-adjudication. In the circumstances, the issue in ground No.5 is also restored to the file of the Assessing Officer for re-adjudication and granting the consequential benefit, if any.
9. In regard to ground No.6, the learned authorised representative submitted that the issue was squarely covered by the decision of the co-ordinate Bench of this Tribunal in the assessee's own case, referred to supra, wherein vide para 14 the site restoration expenditure has been held to be an ascertained liability and is to be considered as an allowable expenditure when computing the book profit under sec. 115JB of the Act.
10. In reply, the learned DR vehemently supported the orders of the learned DRP and the Assessing Officer.
11. We have considered the rival submissions. As it is noticed that the issue in this ground is squarely covered by the decision of the co-ordinate Bench of this Tribunal in the assessee's own case, respectfully following the decision of the co- ordinate Bench of this Tribunal, the Assessing Officer is directed to grant the assessee the allowance of expenditure being the site restoration expenditure when computing the book profits u/s 115J B of the Act.
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12. No other grounds have been seriously contested. Consequently, the appeal of the assessee is partly allowed for statistical purposes.
13. The order was pronounced in the court on 24/02/2012.
Sd/- Sd/-
(N. S. Saini) (George Mathan)
Accountant Member Judicial Member
Chennai,
Dated the 24th February, 2012.
H.
Copy to: Assessee/AO/CIT (A)/CIT/D.R./Guard file